News

Japan falls into spiral of despair

NIGHT after night, the casualties of the new recession shuffle to their beds in makeshift shelters of cardboard boxes lining the steps of Tokyo station and the capital's parks.

They huddle in the glow of lights that burn late into the evening in the mighty skyscrapers of corporate Japan and the Shinjuku government quarter.

The workaholic habits of a post-war generation have not ceased but the job for life, central to modern Japan's social bargain, is in decline. Unemployment rose to 4.4% at the end of 2008 as household names such as Honda, Panasonic, Sony and NEC laid off tens of thousands of staff.

As the world crisis has unfolded, it has delivered one unpredictable blow after another to Japan.

Toyota, revered as the most-efficient carmaker in the world, has admitted its first loss in 70 years. The great exporters like Canon saw earnings plummet, owing to a fall in